Business Recipes for Success

Circuit City's Plan to Fire Employees

I have been a customer of Circuit City for more than ten years. The reason why I prefer this store when I buy electronics products instead of Costco where I could get it at much lesser price, is the assistance given by the sales personnel. They go out of their way to explain the features, unlike in another electronics store which folded up a few years ago, the sales personnel did not give a damn to tell you if they have a better product.

Circuit City announced that it is planning to replace its high-salaried employees with new ones who would start with lower paycheck.

This is the story:

While many human resource professionals were stunned by Circuit City’s bold announcement, on expert believes the company deserves praise for its candor.

"Circuit City has been very up front about the fact that this is a cost-cutting move in order align its costs more closely with industry averages," said David Urban, professor of marketing at Virginia Commonwealth University in Richmond, where Circuit City is based. where Circuit City is based. "Electronics retailing is a tough business, with a lot of pressure on profit margins. Therefore, the major players in that business have to seek efficiencies wherever they can.”

Not everyone agrees.

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Labels: Human Resources

posted by cathy at 10:10 AM